Melissa Bockhold Heather Coddington - Franklin College

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B. Competition Competition is the most important factor to consider in this industry. Due to the relatively even market share distribution, each company has several viable competitors; there are many manufacturers, but a limited number of customers exist. This amplifies the competition in the disk drive manufacturing market. High supply relative to the demand for disk drives creates fierce competition among suppliers (Andrade 3). This is reflected in the product prices and revenues of disk drive manufacturers. 000s of units 300 250 200 150 100 50 0 Worldwide Hard Disk Drive Industry Historical Performance & Projections (1999-2003E) 1991 1992 1993 1994 1995 1996 1997 Years 1998 1999 2000E 2001E 2002E 2003E Total Sales 8
millions of $ 35000 30000 25000 20000 15000 10000 5000 0 Worldwide Hard Disk Drive Industry Historical Performance & Projections (1991-2003E) 1991 1992 1993 1994 1995 1996 1997 Years 1998 1999 2000E 2001E 2002E 2003E Total Revenue In the graphs above, we can see that total unit sales have steadily grown between 1991 and 1999 due to an increase in worldwide demand for disk drive storage. The demand, however, is not growing fast enough to keep prices stable. Looking at the graph of total revenues, it is clear that revenues have not followed the same steady, upward trend. Prices have been driven down so far that, even with stable growth in unit sales, revenues are unsteady and often decline from year to year. Pricing competition among disk drive manufacturers has created this trend, and industry experts expect it to continue (Andrade 3). C. Marketing and Sales Structure Competition among disk drive manufacturers is also prevalent in the industry because suppliers sell to the limited number of customers. Each product cycle, lasting six 9
Page 1 and 2: Seagate Technology Buyout By: Melis
Page 3 and 4: I. INTRODUCTION In 1999, Seagate Te
Page 5 and 6: 1997 1997-1998 July 1998 May 1999 J
Page 10 and 11: to twelve months, is a new opportun
Page 12 and 13: inventories of disk drive component
Page 14 and 15: was to turn the company private sin
Page 16 and 17: STEP TWO: Seagate exchanges existin
Page 18 and 19: 100% 90% 80% 70% 60% 50% 40% 30% 20
Page 20 and 21: the value seen in its VERITAS holdi
Page 22 and 23: For all the reasons listed above, S
Page 24 and 25: large amount of confidence in Seaga
Page 26 and 27: capital structure should have a hig
Page 28 and 29: how capable a company is to pay bac
Page 30 and 31: 1.98. Although, Seagate is much low
Page 32 and 33: The next ratio we calculated was Ne
Page 34 and 35: Seagate Averages (1981- 1999) Disk
Page 36 and 37: ii. Analysis of Historical Financia
Page 38 and 39: experience? What will their earning
Page 40 and 41: Lake and other potential investors
Page 42 and 43: CFO Kenneth Lonchar stated, “We w
Page 44 and 45: X. SILVER LAKE PARTNERS INTERVIEW M
Page 46 and 47: Copy of thank you note mailed to Al
Page 48: XII. WORKS CITED Austin, Alan. Mana

Melissa Bockhold Heather Coddington - Franklin College

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